The Lazy Millionaire: I Own 40 Companies, But Don't Run Any Of Them

Summary

In this masterclass, Andrew Wilkinson shares his expertise on hiring CEOs for scaling businesses. With experience managing 40 companies, he discusses the importance of finding a CEO who can take a business to the next level, structuring compensation for alignment, and the crucial interview process. Wilkinson emphasizes the need for trust, the right fit, and the willingness to delegate fully to ensure the business thrives under new leadership.

Takeaways

• 😀 Hiring a CEO can be a game-changer for scaling a business and allowing the founder to focus on other interests or projects.
• 💼 It's essential to find a CEO who has experience running a similar business, ideally one that was twice the size of your current business, to ensure they have the right skill set.
• 🔍 Conducting thorough due diligence on potential CEOs is critical to avoid costly hiring mistakes and to ensure a good fit for the company's culture and goals.
• 📝 Transparency in the hiring process, including clear communication about the role and expectations, helps in attracting the right candidates.
• 💰 Structuring compensation for a CEO should involve a balance of base salary, bonuses tied to performance, and potentially equity that reflects a shared risk and reward.
• 🤝 Trust is key when handing over the reins to a new CEO, and founders should be prepared to let go and allow the CEO to lead without constant interference.
• 🚀 Entrepreneurs should consider hiring a CEO if they find themselves yearning for new challenges or if they're not fully invested in the day-to-day operations of their company.
• 🛑 Recognizing when it's time to bring in a CEO is crucial; it often happens when a founder is no longer the best person to lead the company due to changes in their interests or lifestyle.
• 🔑 Understanding a CEO candidate's 'hammer' or core strength is important to ensure it aligns with the company's needs and growth strategy.
• 💡 The hiring process should involve a combination of personal interviews, background checks, and reference verifications to get a holistic view of the candidate.
• 🌐 For businesses that can't afford high recruiter fees or extensive background checks, creative and resourceful DIY methods can be employed to find and vet potential CEOs.

Q & A

Why did the host invite Andrew Wilkinson to the masterclass?

The host invited Andrew Wilkinson to share his experience and knowledge on hiring CEOs, as he has successfully scaled multiple companies and currently oversees a portfolio worth $500 million without being directly involved in day-to-day operations.

What was the host's initial hesitation about hiring a CEO?

The host was hesitant because hiring a CEO felt like giving up control of something he had built from scratch. It seemed easier said than done to find someone trustworthy to take over and grow the business.

What is Andrew Wilkinson's approach to finding a CEO for his companies?

Andrew looks for individuals who have run a similar business that is double the size of his own, often targeting number two executives who have been eager to step up to the CEO role but haven't had the opportunity yet.

Why does Andrew prefer hiring number two executives to be CEOs?

Andrew finds that number two executives, who have been part of a similar business and are eager to become CEOs, are often highly motivated and capable of taking on the new challenge of running a company.

What is the 'Hammer' concept mentioned by Andrew, and why is it important?

The 'Hammer' concept refers to a CEO's primary skill or approach to growing a business, such as marketing, sales, operations, or finance. It's important because it indicates the CEO's likely strategy and whether it aligns with the company's needs.

How does Andrew ensure that a potential CEO is a good fit for the company?

Andrew ensures a good fit by checking for trust and alignment with the company's strategy, observing if the candidate is genuine and not overly slick, and assessing whether they are willing to have skin in the game with equity or other forms of risk-sharing.

What is the significance of the 'rider on an elephant' analogy used by Andrew?

The 'rider on an elephant' analogy signifies that once a CEO is hired, they will lead the company in the direction they believe is best, much like an elephant follows its own path despite having a rider. This highlights the importance of strategic alignment during the hiring process.

Why does Andrew emphasize the importance of walking away after hiring a CEO?

Andrew emphasizes walking away to empower the new CEO and to avoid undermining their authority. Constant interference can lead to a lack of trust and confusion among the team about who is truly in charge.

What is Andrew's view on using recruiters for finding a CEO?

Initially skeptical, Andrew has come to appreciate recruiters as they broaden the search spectrum, save time by conducting initial screenings, and can find candidates that might not be on his radar.

How does Andrew handle the transition period after hiring a new CEO?

Andrew believes in a quick transition, often leaving the company's communication platforms and reducing contact to set check-ins, allowing the new CEO to establish their leadership without interference.

What advice does Andrew give regarding the structure of a CEO's compensation package?

Andrew suggests structuring the compensation with a base salary plus bonuses tied to performance goals, potentially with capped bonuses for exceeding targets. He also prefers candidates who are willing to invest in the company's equity, showing a shared risk.